Cash rate to hit 3pc by year's end: ANZ

The Reserve Bank is expected to cut the official cash rate by a further 75 basis points before the end of the year, after new research revealed job advertisements slumped yet again.

According to the latest ANZ Job Advertisement Series, the number of job advertisements on the internet and in newspapers fell 3.1 per cent in April.

Overall advertisements are now approximately 1.7 per cent below the level of April 2011.

Speaking about the results, ANZ’s head of Australian economics and property research Ivan Colhoun said in light of this continued softness in job data, the lender has revised its monetary policy forecast.

“Sustained uncertainty by consumers and businesses and an expectation that fiscal policy will subtract from growth in the year ahead as the Government returns the budget to surplus in 2012/13, has forced ANZ to forecast further 0.75 per cent drop in official interest rates by the end of 2012,” he said.

In addition, Mr Colhoun said he expects to see the unemployment rate rise slightly to 5.3 per cent this month.

“The fall in employment is largely predicated on a reversal of the out-sized rise in overall employment in March and in particular in female part-time employment, a notoriously volatile component of overall employment.”

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